Under the senators' proposals, a cap would be placed on the amount of greenhouse gases American companies are allowed to emit, and each firm would be granted permits, according to their size, allowing them to produce a fixed amount of emissions.

Companies that emit less than their permitted allowance would be able to make money by selling their permits to companies who wish to produce more than their quota, creating an incentive for firms to reduce their carbon output.

Gradually, the overall emissions cap would be reduced.

Critics say the measure could increase the cost of doing business, but its supporters argue that it will create new jobs in the renewable energy sector and help to avert a global climate crisis.

Mr Obama issued a statement thanking the senators for drafting the bill.

"With the draft legislation they are announcing today, we are one step closer to putting America in control of our energy future and making America more energy independent," he said.

"My administration is deeply committed to passing a bill that creates new American jobs and the clean energy incentives that foster innovation," he added.

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